Shares of most chemical makers fell on February 1 after Finance Minister Nirmala Sitharaman, in her budget speech, skipped announcing any measures for the sector.
Accordingly, stocks like Tata Chemicals, Epigral, Balaji Amines, Gujarat Fluorochemicals, Premier Explosives, PI Industries, and Himadri Specialty Chemicals, fell up to 4 percent following the finance minister's budget announcement.
In recent budgets, industry experts have consistently pushed for a production-linked incentive (PLI) scheme for the sector. Amid ongoing challenges, expectations were high for government intervention to provide much-needed support.
Additionally, Axis Securities had anticipated tax incentives for chemical manufacturing hubs like Gujarat, which could benefit several Indian chemical producers.
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The industry witnessed strong growth until 2022 but later faced headwinds due to sluggish global demand and a surge in low-cost Chinese imports.
However, early signs of recovery are emerging, with a full demand revival expected later this fiscal year. In this backdrop, government support through PLI schemes was seen as critical to reviving sentiment and bolstering the sector’s turnaround.
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